My point here is not at all anti-innovation, but simply that all innovation is not good, because innovation is a means not an end. People can innovate for both good, and bad, purposes.

  • Cyber-criminals, hackers, predators, terrorists and other malfactors, constantly innovate on the open Internet with malware, viruses, spam, botnets, p2p piracy and phishing, denial of service attacks, etc.
  • Cyber-security experts marvel at the innovation and ingenuity of these multiplying malfactors.

My big point here is that the push for the Government to maximize innovation by mandating an “open Internet” is a knife that can cut both ways. Just like an open Internet enables well-intentioned innovators, it also can enable innovative cyber-crooks and bad actors.

Anything good can become bad or a problem, if it is taken to excess.

  • While it may be most convenient and efficient for application providers to have the Government mandate and force openness on the Internet, there has been too little discussion about how forced openness could endanger cyber-security by making it equally convenient and efficient for cybercriminals and bad actors to prey on Internet users.
  • While forced openness may improve the competitiveness of application providers versus network and content providers, there has been little discussion about how forced openness could undermine American competitiveness overall by making it easier for foreign entities to engage in espionage and steal American corporate property or trade secrets.

Simply a lack of safety, security and privacy is a greater threat to the Internet, than a lack of innovation or openness. The Internet is overwhelmingly open today, it doesn’t need to be forced open more. What the Internet urgently needs more of is safety, security, and privacy.

Key congressional Chairman overseeing the Internet understand this.

  • Senate Commerce Committtee Chairman Jay Rockefeller is taking the lead in elevating the priority of cybersecurity. In a hearing two weeks ago on cybersecurity, Chairman Rockefeller said: “It is an understatement that cybersecurity is one of the most important issues we face.” As the former Chairman of the Senate Intelligence Committee 2007-2009, Chairman Rockefeller is uniquely positioned to understand the seriousness of the cyber-threat.
  • House Internet Subcommittee Chairman Rick Boucher recently stated in an interview that one of his top three legislative priorities was Internet privacy legislation “primarily with regard to Internet-based applications.”

The Internet is already open; it does not need to be forced open further. What the Internet really needs is to become more safe, secure and respectful of users’ privacy.

House Internet Subcommittee Chairman Rick Boucher had the following to say about the net neutrality issue in an informative interview with Broadcasting & Cable:

  • “Do you believe there still needs to be a network neutrality law?
    • There has to be a firm principle of Internet openness that is abided by all. We do not have a legislative emergency at this moment that requires that as a priority today—in the top rank of priorities for action in the next several months—that we pass legislation such as was considered a couple years ago. I think because we elevated the issue, we showed the depth of concern for that business model. The plans to do that were effectively chilled, and so that hasn’t happened and the Internet has remained open.
    • And in those instances where there have been some eruptions of bad behavior, the FCC has acted very effectively to prevent that activity and keep the Internet open. The status quo is working.”

The combination of the severe recession and Congress’ requirement for the FCC to devise a National Broadband Strategy provides an excellent opportunity to inventory not only weaknesses, but also the many strengths, of the broadband sector and economy. Comprehensive analysis shows much that is going well that mustn’t be taken for granted in any new broadband plans. Unlike many other sectors of the economy, the American broadband sector is:

  • An exceptionally strong foundation to build upon;
  • On the right track with much positive momentum; and
  • Partnering to solve many of society’s most pressing problems.

I. Strong Foundation to Build Upon

America’s competitive broadband market has an exceptionally strong foundation of positives on which to build upon, enhance, expand and supplement.

Financial/economic stability: The American broadband sector is an exceptional relative oasis of financial stability and economic strength in the U.S. economy. While not unhurt by the recession, the sector is still solidly growing and significantly out-performing the broader economy. There are several reasons for the broadband sector’s relative economic strength.

  • Consumer demand for broadband/communications remains relatively strong since broadband generally is viewed as a necessity at home and in the workplace, and is viewed as a crucial connection to the marketplace for those seeking employment or new business.
  • The broadband sector also has rational and healthy technology-platform competition based on real market economics, which makes the sector exceptionally efficient, resilient and sustainable.
  • Demand-driven progressive pricing and usage thresholds ensure that those who want the fastest speeds and use the most capacity pay more to help fund the cost of increasing the Internet’s overall capacity.
  • Demand-driven progressive pricing also keeps the vast majority of users’ prices low, because most are lower volume users.
  • The relative predictability and rationality of market-based competitive economics and return on investment has afforded the private sector the necessary incentives to continue to invest more than most any other infrastructure-based sector, roughly $50-60b annually.
  • Finally, the U.S. broadband sector learned its debt lesson after the tech bubble and cut debt roughly in half to reach historically-responsible levels. Consequently, the sector generally has strong balance sheets, which is enabling companies to continue to invest through the recession.

In short, the U.S. broadband sector, if unimpeded, is, and can be, one of the primary economic engines that will help pull the rest of the American economy back to recovery.

Diversity of Choice: The competitive broadband system in the U.S. produces a wide diversity of choice of technology platforms, business models, prices, speeds, products and services, because competitors are able to respond to Americans’ wide diversity of needs, wants and means. Moreover, the market-based freedom in the U.S. to: experiment, innovate, invest, compete, price and bundle creatively and flexibly make the U.S. broadband economy the most diverse and vibrant in the world.

  • For example, Americans enjoy the wide variety of choice that results from having: the most free WiFi hot spots in the world; several inexpensive alternatives for dial-up Internet access (for the significant portion of Americans that surveys say only want dial-up for now); and a wide variety of broadband prices, speeds, usage models, for light to moderate to heavy to extreme bandwidth users.
  • Furthermore, competitive broadband trends continue to create even more market niches, further increasing the sector’s diversity of choice.

Like America, the American broadband economy is exceptionally diverse and not at all monolithic.

Responsiveness: Technology platform competition in capital-intensive industries produces a very consumer-friendly and responsive marketplace. Since the marketing and operational costs of acquiring a new customer are so high in relative and absolute terms, existing customers have a lot of leverage and routinely benefit from a myriad of value enhancements designed to keep customers happy. Broadband customers routinely get more speed for the same price and are offered a variety of additional features, products and services for free or at a deep discount. Because competitors want to avoid the dreaded high cost of losing a customer, or “churn,” competitors increasingly anticipate consumers’ needs, and adapt to meet consumers’ ever-evolving needs and wants.

  • Moreover, the diversity of choice in offerings enables competitors to be responsive to consumers needs in this recession to save money, by enabling them to spend less on lower priced bundles or to eliminate individual communication services entirely.

Resiliency: Another powerful benefit of the true technology-platform competition that exists in most of the U.S. is that network reliability is essential to avoid expensive churn. Another advantage to the economy that technology-platform competition has over monopoly-resale environments is the relative resiliency of infrastructure redundancy. All of America’s cybrastructure eggs are not in one basket.

American Competitiveness: While the OECD’s data on broadband penetration suggest U.S. deficiencies on that measure, it is important that any national broadband strategy to improve upon that measure does not inadvertently harm other measures at the same time where the U.S. is strong, on the right track or the world leader. In colloquial terms, it is important to not throw the baby out with the bathwater.

There is substantial independent evidence that the U.S. broadband sector has a strong foundation to build upon. No less than seven independent studies conclude that America is at, or near the top, in worldwide competitiveness in the converging sector of Internet, broadband, communications, and information technology.

  1. World Economic Forum: Global Information Technology Report – 2008-2009: Ranks the U.S. third in “Networked Readiness” — up one place in the world rankings from last year.
  2. ITU -2009: The U.S. has the most affordable broadband in world.
  3. University of Calgary – 2009: The U.S. ranks #1 in the world in their “Connectivity Scorecard.”
  4. IMD Swiss Business School – 2008: The U.S. ranked #1 in the world for the 14th year in a row in the 2008 World Competitiveness Yearbook.
  5. World Economic Forum – 2008: The U.S. ranked #1 in competitiveness in its 2008-2009 Competitiveness Report.
  6. Economist Intelligence Unit: The U.S. was ranked tied for second in the world in “e-readiness” per their latest rankings.
  7. Neilsen – 2008: The U.S. ranked #1 of 16 countries surveyed in mobile Internet penetration.

II. On Right Track with Positive Momentum:

While there is always room for improvement, by almost every objective competitive measure over the last several years, the trajectory has been towards more competition, choice, and value for consumers and businesses. The most important indicators of competition are positive.

  • Despite the recession’s substantial contraction of the overall economy, broadband investment, deployment, and penetration continues strongly apace.
  • Broadband connections and networks continue steadily getting faster and have more and more overall capacity.
  • The price/value proposition for the average broadband consumer continues to improve substantially.
  • Competition is driving smart network innovation to reduce the threats of spam, viruses and malware on networks.
  • Increasing broadband use also continues to provide productivity gains that benefit the broader economy.

III. Partnering to Solve Society’s Broader Problems

The broadband sector has been and continues to be responsible corporate citizens in partnering with groups and government to help improve and solve some of society’s most important problems.

  • A healthy broadband industry able to invest and innovate helps provide more opportunities to telecommute, a big green benefit in keeping cars off the road, and minimizing the need for travel. Another green benefit from broadband and wireless broadband is smart grid and remote energy management to better manage and lower the Nation’s energy usage and costs.
  • A competitive broadband industry also is able to invest and innovate to bring the benefits and health care savings of telemedicine, remote medical monitoring and digital health records to more and more Americans.
  • On the matter of jobs in this severe recession, it is important to remember that the broadband industry provides substantially more stable employment at better compensation and benefit levels than is the norm in the broader economy.
  • On the matter of openness, the two thousand broadband providers in the U.S. have had near perfect compliance with the FCC’s Broadband Policy Principles, handling literally quadrillions of communications without incident every year.
  • The broadband sector has long been a leader in the economy in promoting diversity in the workplace.
  • Finally, the broadband sector also has a long and strong record of helping better the lives of the visually and hearing impaired through tailored or innovative services.

IV. Conclusion

The task and challenge for the FCC in devising a National Broadband Strategy is not only addressing the Nation’s broadband deficiencies, but also preserving and strengthening America’s many competitive broadband strengths. In other words, in improving broadband in the U.S. on the margin, it is essential to not undermine the part of the broadband base that works and excels. In colloquial terms, the FCC must ensure it does not unintentionally throw out the baby with the bath water.

In sum, in devising its National Broadband Strategy, the FCC has a strong foundation to build upon, positive competitive momentum to continue, and responsible corporate citizens with which to partner.

Here is the link to get this post in White Paper PDF form:

Evidence continues to mount that the real problem on the Internet is that it is not as safe and secure as it needs to be — not that it is not open enough. (Parts: I, II, III, IV)

“Cyber Security: The Achilles Heel of U.S. Might?” Washington Post

  • “…the fact that the nation’s cyber vulnerabilities continue to grow, and fast.”
  • “Both the high-profile attacks and more routine infiltrations have shed light on the vulnerability of critical information infrastructures. For example, the Defense Science Board noted that the U.S. military’s information infrastructure is the “Achilles’ heel of our otherwise overwhelming military might.”

“Smart Grid May be Vulnerable to Hackers” CNN

  • A hacker also might be able to dramatically increase or decrease the demand for power, disrupting the load balance on the local power grid and causing a blackout. These experts said such a localized power outage would cascade to other parts of the grid, expanding the blackout.”

‘Website-infecting SQL injection hitting 450,000 a day” USA Today

  • Click on one and you won’t notice anything. Your PC gets turned into an obedient “bot,” short for robot, deployed to attack other computers. All of your sensitive data get stolen.”

“Beware New Malware in Web Apps” PC World

“Children Have Little Understanding of Internet Security” Security Park

  • ““A large percentage of children are using a shared computer for downloading music, using P2P software or chatting using Instant Messaging, whilst their parents are using it for emailing, online shopping, banking or completing corporate activities. This places parents at high risk of being exposed to a whole array of viruses, scams and Trojans that may have been introduced to the home computer through their children’s seemingly harmless activities on the net.”

“35% of infected PCs had up to date anti-virus software” Windows IT Pro

  • How does that happen? The obvious answer is that the anti-malware software in use on the infected computers isn’t adequate.”

“Securing Cyber Space Requires a New Attitude” Government Computer News

  • “…possibility of inappropriate military retaliation — with either cyber or physical weapons — for a perceived cyberattack will make cyberspace and the real world much more dangerous than they need to be.”

“White House Helicopter Data found on Iranian Computer” Reuters

  • This is like a stolen laptop times a million,” Tagliaferri said, noting that data breaches through file sharing networks were growing increasingly more common as more people shared electronic versions of movies and music. Hackers and criminals are becoming more savvy in pinpointing such files, he said.”

“Winning the hidden war” Washington Times

  • Unfortunately, this interconnectedness also has led to an increased dependence on the Internet, and thus, increased vulnerability for individuals and for our country’s cyber-security. This increased exposure has been accompanied by real and growing threats from basement hackers stealing credit card and Social Security numbers to cyber-terrorists shutting down our nation’s power grid, to hostile foreign governments invading our military’s defense networks.”

“Surprisingly low number of people are aware of Internet security risks of poor password protection” ChattahBox

  • According to a survey done on Internet users, only 19% use different passwords for different sites.”

“Rogue application exploits Facebook’s TOS to target its users” SpamFighter

  • Security experts state that the problems’ principal cause is that the site allows any visitor to develop an application and because of this, malicious programs repeatedly pop-up on Facebook.”

“The Pirate’s First Mate” ESET

  • When it comes to software piracy, it is hard to find a more complicit, competent, and friendlier ally than Google, assuming you are a pirate. Google owns the popular blogging site “Blogspot.com”. If you want to know how to illegally gain access to software, blogspot is probably one of the premier resources on the internet today.”

IRS improves cyber-security, but still vulnerable to malware” NextGov

  • The Internal Revenue Service has improved its protection of computer networks from malicious software attacks, but it has failed to scan computers for viruses and to enforce security policies, which put taxpayer data at risk, according to a report the IRS inspector general released on Monday.”

“How to be a safe WiFi warrior” CNNMoney

  • You’re insecure if you’re on any publicly available network,” says Ken Silva, chief technology officer at Internet security firm VeriSign (VRSN). Silva adds that basic measures, like installing a firewall and antivirus software, are no longer enough to protect your data.”

TRUSTe consumer survey:

  • Six percent of respondents reported having their identity stolen in the last year
  • One in ten (11%) experienced credit card theft in the last twelve months
  • Thirteen percent reported unauthorized sharing of highly sensitive personal information, such as health and financial records over the last year.”

Internet safety/security issues are only growing in number and seriousness; it is the real Internet problem warranting most attention.

Free Press in its latest report: “Deep Packet Inspection: The end of the Internet as we know it?” continues to mischaracterize “reasonable network management” practices (that ensure quality of service and filter out harmful traffic like spam, viruses, and other malware) as bad practices and misuse of technology that threatens users’ privacy and freedom of speech.

It is inaccurate and unfair to mischaracterize reasonable network management this way.

The Free Press report uses a common analogy about “deep packet inspection” (DPI) technology. It analogizes that use of DPI technology by an ISP would be like the post office going beyond reading the address of a letter and looking inside the letter to read the private contents.

  • This partial analogy is designed to lead people to believe that DPI is only a privacy-invading technology without any merit or useful function.
  • Let’s explore the letter and post office analogy more fairly and accurately.

Most people know that letters and packages are screened/filtered by the Post Office, FedEx, UPS etc. for harmful or illegal materials.

Since it is illegal for people to mail: firearms, explosives, illegal drugs, harmful chemicals or biological agents, etc. these companies routinely screen and filter these packages with x-rays and other sensing technologies to interdict these illegal and harmful packages in transit before they can do harm.

Given Free Press’ strong opposition to DPI’s potential for invading privacy, it is curious why Free Press does not acknowledge, or object to, the Post Office routinely employing “deep package inspection” technologies.

It is also curious why Free Press has never accused (to my knowledge) the Post Office or the delivery companies of using their deep package inspection technologies to invade users’ privacy or limit free speech.
* Most people also know or assume that communications networks routinely filter and interdict spam, viruses, malware, denial of service attacks and other illegal and harmful uses of Internet networks.
o It is curious that in discussing “deep packet inspection” Free Press almost exclusively characterized it in a negative light and ignores the postive and necessary aspects of deep packet inspection technology.
o Finally, it is curious that Free Press and others that oppose reasonable network management do not acknowlege that broadband companies (telecom, wireless and cable) companies have long been subject to strict privacy laws (sections: 222, 551 & te ECPA).

In short, an objective and straighforward analysis of DPI technology shows that it has many legitimate and important benefits. Common sense also indicates that broadband companies are no more likely to incorrectly use legitimate inspection technologies than any physical delivery service.